By Inhwan Ko &
August 11, 2024
Source: Nature
Photo / Image Source: Unsplash,
Results
Event study analysis
The first step employs event study analysis with four sub-sample groups: S&P 500 companies that have committed
(Tier 4), verified 2 °C target
(Tier 3), verified well below 2 °C target
(tier 2), and verified 1.5 °C target
(Tier 1).
We expect that firms with SBTi membership with higher costs, e.g., verified 1.5 °C target as opposed to other tiers, should experience higher stock market rewards. We used WRDS Analytics (U.S. Daily Event Study) to run event study analyses26.
All analyses used 100 days before the event date to estimate the coefficients (i.e., estimation window). Using these coefficients, we calculate the abnormal returns within ten days before and after the event date (i.e., event window).
Ko, I., Prakash, A. Stock markets, corporate climate pledges, and the Science-Based Target Initiative. npj Clim. Action 3, 69 (2024). https://doi.org/10.1038/s44168-024-00148-8
Received05 April 2024
Accepted24 July 2024
Published11 August 2024
DOIhttps://doi.org/10.1038/s44168-024-00148-8
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